The off-price chain saw its shares drop 2% to $105 in after-hours trading on the release of its financial results for the period ended Aug. 3. Ross noted profits that rose 6% to $413 million, or $1.14 a share, up from $1.04 last year and better than Wall Street’s forecasts of $1.12. Sales also grew 6% to $4 billion. (Analysts predicted revenues of $3.96 billion.)
Additionally, Ross’ same-store sales were up 3% on top of last year’s strongest quarterly comparison of 5%.
However, the company noted the trade war’s potential hit on business, with CEO Barbara Rentler attributing a decision to lower the firm’s earnings guidance to the upcoming 10% tariffs on goods sourced from China, including apparel and footwear.
Many retailers — as well as industry leaders and trade organizations — have spoken out against the upcoming fourth tranche of tariffs, which would affect $300 billion worth of Chinese imports.
Last week, the U.S. Trade Representative announced that it would postpone the 10% duty on some of the $300 billion worth of Chinese products — leading one set of tariffs to be slapped with the additional duty on Sept. 1 and another hit on Dec. 15. The delay would effectively take place after the crucial holiday shopping season for retailers.
Ross now expects full-year EPS in the range of $4.41 to $4.50, compared with the prior guidance of $4.38 to $4.52.
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Watch the highlights at the 2018 FNAAs.